1. The petitioner is a registered firm registered both under the provision of the Indian Partnership Act and under the provisions of the I.T. Act, 1961. Since May 1, 1970, the petitioner-firm has been carrying on business of purchase and sale of land, of building contractor and of organising societies for house-building. The respondent herein is the ITO having jurisdiction to assess the petitioner-firm. The year under dispute is assessment year 1977-78, the relevant accounting period being May 1, 1975, to April 30, 1976. The petitioner is being assessed to income-tax from the very first year of inception of its business, that is, from assessment year 1972-73 onwards. For the assessment year 1977-78 the petitioner filed its return of income on April 14, 1978. Along with the return the petitioner filed a computation of income, profit and loss account and the balance-sheet for the year ended April 30, 1976. That assessment was completed. Thereafter, notice under s. 143(2)(b) of the I.T. Act was issued on December 27, 1979, in connection with the assessment year 1977-78 and the date of hearing was fixed for January 17, 1980. On January 17, 1980, the petitioner's accountant along with the authorised representative, M. J. Desai of I. G. Desai & Co. Chartered Accountant, s Surat, appeared before the respondent with the books of account for the relevant accounting year. The books of account, according to the petitioner, were examined by the respondent who made certain inquiries and sought for certain further information and an explanation which was given to him by the petitioner's authorised representative. The queries raised by the respondent and the information sought for were handed over by the authorised representative and the fact that they were examined was indicated by way of remarked of the authorised representative on the papers. Thereafter, the petitioner received an assessment order dated April 25, 1980, passed by the then ITO. In the assessment order against column No. 7, the section and sub-section under which the assessment was made were mentioned as s. 143(1), though in fact, according to the petitioner, the same ought to have been s. 143(3), as the assessment was completed under s. 143(3) of the Act after the issuance of a notice under s. 143(2)(b) of the Act.
2. The previous ITO appears to have been transferred and the jurisdiction appears to hag been changed and the present respondent herein became the officer-in-charge of the petitioner's case. In the month of September, 1980, the petitioner was served with summons dated September 10, 1980, under s. 131 of the Act to appear before the respondent on September 19, 1980, along with the books of account for the assessment year 1977-78. In fact, at that time no proceedings for the said assessment year were pending as envisaged and required by s. 131 of the Act. There is a space provided in the form of the summons which was kept blank and on the reverse of the summons form it was mentioned :
'Come with books of account for A.Y. 1977-78 though order has been passed under section 143(1).'
3. The petitioner appeared before the respondent on the appointed day with the books of account as called for. The respondent examined the books of account on the said date and called the petitioner again on September 24, 1980. The respondent impounded the books of the petitioner on September 24, 1980, and issued a receipt to the petitioner for the same. At the time of hearing on September 24, 1980, the respondent directed the petitioner to appear again on October 3, 1980. On the said date, that is, October 3, 1980, the respondent recorded the statement of Rashmikant Bhikhubhai Patel, one of the partners of the petitioner-firm, and immediately thereafter, that is, on October 4, 1980, the petitioner applied for a certified copy of the statement of Rashmikant Bhikhubhai Patel recorded on October 3, 1980. Thereafter,on October 6, 1980, the petitioner-firm received a notice date October 4, 1980, under s. 148 of the Act mentioning that the respondent believed that income chargeable to tax for the assessment year 1977-78 had escaped assessment within the meaning of s. 147(b) of the Act. On October 25, 1980, the petitioner sent a letter through its authorised representative explaining the legal position in the context of the facts and circumstances of the face and asked the respondent to furnish the basis on which the respondent had reopened the assessment for the said assessment year 1977-78. On December 2, 1980 the petitioner's authorised representative wrote a letter by way of reminder to the respondent for supplying the copy of the statement of Rashmikant Bhikhubhai Pate. The petitioner's authorised representative personally saw the respondent on December 3, 1980, requesting for a copy of the statement, to which the respondent expressed his inability, and hence, the authorised representative approached the IAC, Surat Range-I, Surat. On being orally directed by the IAC, the respondent ultimately supplied the statement, vide his covering letter dated December 5, 1980. In the meantime, on December 2, 1980, the petitioner also applied in Form No. 6 for an extension of time for furnishing the return in response to the s. 148 notice. The respondent by letter dated December 5, 1980 mentioned the reasons for issuing the notice under s. 148 of the Act. According to the reasons set out in this letter of December 5, 1980, the correct income for the relevant year had been reduced by overwriting and interpolation in the said books of account and the same had resulted in an underassessment of income. The petitioner said and submitted that the books of account which were impounded by the respondent on September 24, 1980, were the same books of account which were produced and examined by the then ITO at the time of hearing in response to the notice under s. 143(2)(b) of the Act on January 17, 1978. The overwriting or interpolation in the said books, if any, must have been there from the beginning and that the petitioner could not have any reason for overwriting or interpolating after the assessment was over on January 25, 1980. The respondent in the reason stated by him in his letter dated December 5, 1980, has not mentioned as to how and to what extent the correct income had been reduced resulting in an under assessment for the said year and the petitioner in the present proceedings under art. 226 of the Constitution has challenged the notice dated October 4, 1980, for the relevant assessment year 1977-78 issued by the ITO under s. 148 of the I.T. Act.
4. In our opinion, the real document in this case is the notice dated December 27, 1979, a copy of which is Ex. B to the petition. This notice was issued under s. 143(1)(b) of the Act and it states :
'There are certain points in connection with the return of income submitted by you for the assessment year 1977-78 in regard to which I should like some further information. You are hereby required to attend my office at Nanpura on 17-1-1980 at 2-00 p. m. either in person or by a representative duly authorised in writing in this behalf or there produce or cause to be produced at the said time any documents, accounts and the evidence on which you may rely in support of the return filed by you.'
5. It is true that the assessment order purports to be under s. 141(1) of the Act but in view of the notice dated December 27, 1979, authenticity of which cannot be doubted in view of the fact that the original notice carries the signature of the then ITO and also the seal of his office, it is clear that on January 17, 1980, the books of the petitioner were in fact examined by the then ITO. The assessment order was passed on January 25, 1980. In pursuance of the notice, Ex. B to the petition, all books of account relevant for assessment for the assessment year 1977-78 were produced by the petitioner before the then ITO and also all necessary information was furnished. Thus all the books of account in which interpolations are now purported to have been found or the change which are now purported to have been found out by the present ITO were examined before the order dated January 25, 1980, was passed under s. 143(3) of the Act though on the face of it the order purports to be under s. 143(1) of the Act. After all, those books of account were seen by the then ITO before he passed the order on January 25, 1980, and thus, it must be taken for granted that the interpolations and changes by overwriting and alterations were noticed by him before he passed the assessment order on January 25, 1980. However, the successor, the present respondent herein, has issued a notice under, s. 148 of the I.T. Act purely because he came to a different conclusion regarding the effect of these interpolations and overwriting. On the same materials a change of opinion cannot form the basis of a notice under s. 148 so far as proceedings for the reopening of an assessment under s. 147 of the I.T. Act are concerned. Under these circumstances, the respondent was acting without jurisdiction when he issued the notice under s. 148 of the Act merely because he formed a different opinion that his predecessor who passed the order under s. 143(3) of the I.T. Act, 1961. Under these circumstances, the notice under s. 148 of the Act, being Ex. F to the petition, is quashed and set aside and the respondent is directed to cease from proceeding further against the petitioner in pursuance of the said notice dated October 4, 1980, Ex. F to the petition. Rule made absolute accordingly. The respondent must pay the costs of these proceedings to the petitioner.